When you live in the Netherlands you pay tax in the Netherlands on your income, on your financial interests in a company and on your savings and investments. The Tax and Customs Administration (Belastingdienst) collects income tax.
You are subjected to pay tax on your income when you live in the Netherlands. Some of your expenditures may be tax-deductible.
For tax purposes, income is divided into three categories (known as boxes).
In box 1, you pay tax on your taxable income from work and home ownership.
Income from work includes:
Income in box 1 is taxed at a progressive rate with four tax brackets. Once you have reached the state pension age, a special rate applies. The government intends to reduce these four tax brackets down to two in 2021.
|Box 1 Tax Rate 2022|
|Tax bracket||Tax rate|
|€ 0 - € 69,397||37.07 %|
|€ 69,398 and upwards||49.50 %|
|Box 1 Tax Rate 2023|
|Tax bracket||Tax rate|
|€ 0 - € 73.071||36,93 %|
|€ 73.071 and upwards||49.50 %|
Some expenditures are deductible from your income from work and home ownership (personal allowances). The tax is calculated on the remaining amount. Your tax credits are then deducted, leaving the amount of tax payable.
In box 2, you pay tax on any substantial interests. You have a substantial interest if you, or you and a tax partner together, own at least 5% of the shares, options or profit-sharing certificates in a company. You pay 25% tax on income from substantial interests.
|Tax year||Tax Rate|
You pay tax on income from your wealth, including savings, shares and a second home. It is calculated as the value of all assets (such as savings and shares) minus any debts. Part of your wealth is not taxable: the capital yield tax allowance. You pay 30% tax on your taxable income from savings and investments. The government assumes a fixed return, which varies, depending on your savings and investments.
|Total asset||Tax rate over total asset|
|€ 0 – € 50,649||1.82 %|
|€ 50,650 – € 962,349||4.37 %|
|€ 962,350 and over||5.53 %|
The income tax in the Netherlands for 2022 is 37.07 % between € 0 - € 69,397 and 49.50 % between € 69,398 and upwards.
The Netherlands is considered a Welfare state, where higher earners pay up to 49,5% taxes over their salary. This is lowered considerably the last years but is still high compared to other countries.
If you live in the Netherlands or receive income from the Netherlands, you will have to pay income tax in the Netherlands. You will have to pay taxes in the Netherlands on your income, on your financial interests in a company and on your savings and investments.
The income tax in the Netherlands for 2023 is 36,93 % between € 0 - € 73.071 and 49.50 % between € 73.071 and upwards.
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